International Media Watch of news headlines and current affairs reports about Romania

Monday, December 20, 2010

Romanian government survives no-confidence vote

By Radu Marinas and Luiza Ilie

BUCHAREST (Reuters) - Romanian Prime Minister Emil Boc survived his third no-confidence vote this year as expected on Monday, enabling his fragile coalition to press on with reforms to keep a 20-billion-euro bailout on track.

The leftist opposition fell 46 votes short of toppling Boc, who is turning out to be one of Romania's most resilient prime ministers in the two decades since communism, in a motion called over International Monetary Fund-backed wage reforms.

That was a wider margin than the two previous confidence votes in 2010 and indicates Boc can probably hold on to power until scheduled elections in 2012, even if the opposition persists with attempts to topple him, as many analysts expect.

"I think the opposition is diluting the importance of no-confidence votes and is losing steam as a result," said Barclays Capital economist Daniel Hewitt. "Thursday could even be a wider margin."

But Monday's reprieve did nothing to change the fact that Boc's centrist coalition, with only a slim parliamentary majority, may still struggle to push through important legislation. Another no-confidence vote is due on Thursday, which analysts also expect him to defeat.

Romania's leu currency was largely unchanged on the day against the euro by 11:58 British time (1158 GMT).

The European Union's second poorest member has so far received 16 billion euros in loans from an IMF bailout and must keep the money flowing to maintain investors' trust and overcome a painful economic contraction.

Thursday's confidence motion was brought by the leftist opposition over plans to make state salaries more transparent, in line with IMF requirements.

The government is racing to clear a cost-cutting budget for 2011 by the end of this year so that it can receive fresh loans in January, and start talks on a new aid deal once the current one expires in March.

On Sunday, parliamentary committees gave a green light to the 2011 budget bill, keeping the IMF-backed parameters and opening the way for quick debates in the assembly this week. Ruling party legislators are optimistic it will pass unchanged.